SOPA, Meet The Player Piano Copyright Threat

Daniel Fisher
,
Forbes Staff
I cover finance, the law, and how the two interact.

The player piano: an instrument of death for the music industry?

Wikipedia and Google are wearing black today to protest the threat to Internet freedom presented by the Stop Online Piracy Act. But if history is a guide, Congress and the content industry's lobbyists will always be at least one step behind technology when it comes to preventing the next threat to the state-protected monopoly known as copyright.

Consider the player piano. When it arrived on the scene in the late 19th century, music publishers were horrified by this new machine that allowed anybody to recreate the performance of a great pianist inside their own home without paying a dime in royalties. By 1906 there were 75,000 player pianos clinking out copyright violations all across this country, using millions of perforated paper rolls that contained, in many cases, note-for-note transcriptions of famous performances.

The music publishers sued and in 1908 the U.S. Supreme Court decided, in White-Smith Publishing v. Apollo, that the player-piano roll was a mere mechanical device, not an unauthorized copy of sheet music. Put a player piano inside a saloon or a performance hall and you'd be liable for performance royalties. But inside the home, the court decided, it was just another type of music box. Justice Oliver Wendell Holmes, in a prescient side note, said Congress needed to update the laws, because "on principle anything that mechanically reproduces that collocation of sounds ought to be held a copy." And indeed, the next year Congress passed a special tax of 2 cents per player-piano roll to help defray the enormous cost to content providers of unauthorized performances in the home. As of 1996 the rate had risen to 6.95 cents.

The same story has replayed with every new technology. Often Congress and the content industy pursue the providers of technology, since going after the actual copyright infringers is so tough. (SOPA, for example, targets U.S. website operators that provide access to illegal foreign sites.) As Seventh Circuit Court of Appeals Judge Frank Easterbrook noted, “contracts limiting the use of intellectual property are hard to enforce because violations are so hard to detect – one reason why patent holders so often sue contributory infringers that furnish unpatented, but essential articles to true infringers.” The first attempt to do this in the video market failed, of course: In the Betamax case in 1984, the Supreme Court held that because Sony video recorders were capable of “substantial noninfringing uses” they were exempt from copyright litigation.

Remember Digital Audio Tape? Sen. Alfonse D'Amato was plenty worked up about it back in 1990, when he fretted that perfect, hiss-free DAT threatened a huge swath of the U.S. economy. “Are we to wait until the American music industry is destroyed, or until our local record stores and radio broadcasters are driven from the marketplace, before we act to manage this monumental change?” he asked. As outlined in this excellent history of digital-rights management schemes by Nika Aldrich, now of DLA Piper, Congress responded with the Audio Home Recording Act of 1992, which included 3% royalties of blank DAT tapes and a Serial Copy Management System designed to prevent users from cranking out multiple copies of copyrighted music. Dubbed "SCUMS" by critics, SCMS outlived the generally unpopular DAT format and was later incorporated into compact disc recorders.

Sometimes Congress creates opportunities for some enterprising digital-rights-management companies. In the Digital Millennium Copyright Act of 1998, Congress ordered all videocassette recorders to contain copy-protection circuitry to prevent the duplication of copyright movies. Bowing to the preferences of the film industry, Congress mandated Macrovision’s analog copy control technology, already used by most of the major studios and VCR tape replication centers as well as billions of VCR tapes worldwide. DMCA has provided a tidy business for Macrovision, but hardly a windfall: VCR-related revenues fell 42% to $7.6 million from 2000 to 2002 as consumer preferences switched to the newer DVD format. (In a famous DRM backfire, Sony was sued in 2006 for installing a stealthy "rootkit" on 4 million CDs that burrowed into users' computers and made them vulnerable to viruses and other damage. Sony quickly removed the software.)

Technology, meanwhile, marches on. As DAT and compact discs have faded, copyright wars have shifted to computers and the Internet. The Ninth Circuit, in 1999, decided that computer hard drives do not qualify as "recording devices" under the AHRA, and thus didn't need to include SCUMS -- sorry, SCMS. As Aldrich details in his paper, while the movie and recording industry dickered over DVD formats that would protect their precious content, Steve Jobs threw them another curve with iTunes, which skipped discs entirely. The market moved in Apple's direction and eventually the content industry embraced it.

In the back-and-forth between Congress and technology innovators, Aldrich says, Congress is always the second mover.

"Technology is continuing to expand the number and quality of copies people can make, and when it gets to the point that it limits the incentive to create, Congress steps in and adjusts the balance,” he says. "As they do that, it shifts the balance intellectual property laws are always trying to strike between incentives to create new content and the ability to use existing content in new ways."

The battle over SOPA, then, fits in with a fine tradition. The music industry survived the player piano and the player-piano tax didn't prevent a collection of musical geniuses in New Orleans, Chicago and the Mississippi Delta from creating jazz and blues, two of the biggest contributions to human culture. Congress didn't kill the music industry in the 90s with the DAT tax. And even if SOPA passes in its current form, I predict hackers will quickly release a small bit of code that directs the curious to foreign websites without Google or URLs. Technology advances, and Congress reacts.